Auditing Services RFP

Request for Proposals for Auditing Services

Town of Arlington, Vermont

INTRODUCTION

The Town of Arlington, Vermont, is requesting proposals from qualified firms of Certified Public Accountants to audit its financial statements for the fiscal year ending December 31, 2021, with the option of auditing its financial statements for each of the four subsequent fiscal years.

Proposals are to be submitted by 2:00 PM on Friday, August 19, 2022 via email to nick.zaiac@arlingtonvermont.org, by mail to:

Nick Zaiac

Town of Arlington, Vermont

PO Box 268

Arlington, VT 05250

nick.zaiac@arlingtonvermont.org

Or by placing a physical copy in the drop box located at the front foyer of 3828 VT Route 7A Arlington, VT 05250.

The Town of Arlington reserves the right to reject any or all proposals submitted. Proposals will be evaluated by the Town based on firm experience and reputation, understanding of Town requirements, and price. During the evaluation process, the Town reserves the right, where it may serve in the Town’s best interest, to request additional information or clarification from proposers. At the discretion of the Town, firms submitting proposals may be requested to make oral presentations as part of the evaluation process.

Please direct all questions regarding this request for proposals to Nick Zaiac, Town Administrator, 802-379-9916.

NATURE OF SERVICES REQUIRED

The Town of Arlington, Vermont, desires the auditor to express an opinion on the fair presentation of its general-purpose financial statements in conformity with generally accepted accounting principles for government. The Town also desires the auditor to express an opinion on the fair presentation of the combining and individual fund financial statements and schedules in conformity with generally accepted accounting principles.

The audit shall be performed in accordance with generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants; the standards for financial audits set forth in the U.S. General Accounting Office’s Government Auditing Standards; the provisions of the Single Audit Act of 1984 and the Single Audit Act Amendments of 1996 (when applicable); and the provisions of the U.S. Office of Management and Budget (OMB) 2 CFR, Chapter I, Chapter II, Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.

The Town does not anticipate spending in excess of $750,000 in federal awards and will not require an audit in accordance with the Single Audit Act of 1984.

It is expected that in determining the extent of test procedures, full consideration will be given to the apparent effectiveness of the system on internal accounting controls. The feasibility of recommendations for improvements in the accounting system and internal controls will be discussed during the course of the engagement. In the required report on internal control, the auditor shall communicate any reportable conditions found during the audit. Reportable conditions that are also material weaknesses shall be identified as such in the report. Non-reportable conditions discovered by the auditors shall also be reported in a separate management letter, which shall include all instances of noncompliance.

The auditor will deliver an electronic copy of the auditor’s report to the Town Administrator at nick.zaiac@arlingtonvermont.org and in addition to that shall print, bind and submit 3copies of the audit report to the Town. Additional copies of the report shall be submitted to the federal cognizant audit agency and any agencies of the State of Vermont, as required. 

At the conclusion of the audit, the auditor will meet with the Select Board to discuss the results of the audit and explain any findings that are included in the auditor’s management letter.

All working papers and reports shall be retained for a minimum of three years, unless the firm is notified in writing by the Town of the need to extend the retention period.

DESCRIPTION OF THE GOVERNMENT

The Town of Arlington has a population of 2,456. The Town provides the following services to its citizens:

Highways and streets

Recreation and Park

Planning and Zoning

Fire Service

Water Service

Public cemeteries

General administrative services including a Town Administrator, Clerk, Treasurer, and associated assistants

The Town had a total payroll of approximately $500,000 covering 5 full-time and 13 part-time or seasonal employees in 2021, with changes in full-time and part-time mix in subsequent fiscal years. Approved budgets for the most recent fiscal year are $1.826 million for the General Fund and $293,333 for Water Department Funds. The Town uses the following fund types in its financial reporting:

  • General Fund
  • Water Department Reserve Fund
  • Capital Projects Funds
  • Grant Fund
  • Audit Fund
  • Cemetery Perpetual Care Fund and 2 small funds under management of the Trustees of Public Funds

The Town prepares its financial statements using the modified accrual basis of accounting for governmental funds and the accrual basis of accounting for proprietary funds. The Town’s financial statements are not prepared in accordance with Governmental Accounting Standards Board Statement No. 34, Basic Financial Statements – and Management’s Discussion and Analysis – for State and Local Governments.

PROPOSAL REQUIREMENTS

Interested firms shall submit its proposal separated into two sections: the technical proposal and the cost proposal.

The purpose of the technical proposal is to demonstrate the qualifications, competence and capacity of the firms seeking to undertake the audit of the Town of Arlington in conformity with the requirements of this request for proposals. The technical proposal should demonstrate the qualifications of the firm and of the particular staff to be assigned to this engagement. It should also specify an audit approach that will meet the request for proposals requirements. The technical proposal shall provide the necessary information in the following sequence:

  • Background of the firm. The proposer should state the size of the firm, the size of the firm’s governmental auditing staff, and the number and nature of the professional staff to be assigned to this engagement. The firm is also required to submit a copy of the report on its most recent quality control review, along with a statement of whether that quality control review included a review of specific government engagements.
  • Partner, supervisory and staff qualifications and experience. The proposer should identify the principal supervisory and management staff assigned to the engagement and disclose each person’s government auditing experience.
  • Similar engagements with other government entities. The proposal shall describe the five most significant engagements performed in the last five years that are similar to the engagement described in this request for proposals. Indicate the scope of the work and the name and telephone number of the client contact.
  • Specific audit approach. The proposal should set forth a plan of implementation, including an explanation of the audit methodology for this engagement. The work plan should include a description of tasks, estimates of work effort, time budgets, and a detailed breakdown of responsibilities of all audit personnel.

Structure the cost proposal as follows:

  • This is a five-year engagement; one year with renewal options through the fifth year.
  • Total all-inclusive maximum price for the engagement for the year ending December 31, 2021, and for each of the four subsequent engagement years for which the Town has the option of continuing in this contract.
  • Breakdown of costs by year by partner (principal), supervisory and staff level.
  • Out-of-pocket expenses included in the total all-inclusive maximum price and reimbursement rates.
  • Progress payments will be made on the basis of hours of work completed during the course of the engagement. Interim billing shall cover a period of not less than a calendar month and should provide sufficient detail for verifying that the work was completed.
  • Unit pricing for non-audit services that are in compliance with independence standards should those be required.

EVALUATION CRITERIA

The final selection of an audit firm will be based on two criteria: technical qualifications and price. The technical qualifications will compare each proposer’s expertise and experience in providing quality audit services to government entities and the quality of the firm’s professional personnel who would conduct the audit. The approach of the audit and the plan for implementation will also be scrutinized. Cost will not be the primary factor in the selection of the audit firm.

There is no expressed or implied obligation on the part of the Town of Arlington to reimburse responding firms for any expenses incurred in preparing or presenting proposals in response to this request.

The Town of Arlington reserves the right to retain all proposals and to use any ideas in a proposal regardless of whether the proposal is selected. Submission of a proposal indicates acceptance by the firm of the conditions contained in this RFP, unless clearly stated to the contrary and specifically noted in the proposal submitted and confirmed in the contract between the municipality and the selected firm.

The Town of Arlington reserves the right to accept or reject any proposal, at their sole discretion, and to award a contract based solely on their determination of the best proposal considering all of the circumstances.

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